U.S. manufacturing output contracted in March 2025, following two months of marginal growth after a prolonged period of decline. According to the Institute for Supply Management (ISM), the manufacturing index fell to 49%, down 1.3 points from February, indicating contraction. An index below 50 signals a decrease in manufacturing activity.
Timothy R. Fiore, ISM chairman, stated that 'U.S. manufacturing activity slipped into contraction' during March. He noted that demand and output weakened, while input costs continued to rise, negatively impacting economic growth. Weakened demand indicators included a decline in new orders, reduced export orders, and faster contraction of order backlogs. Customer inventories remained at levels deemed "too low", while factory output also decreased.
Employment in the manufacturing sector moved further into contraction, as companies preferred to "attrite down" rather than conduct layoffs. Out of 18 recognised manufacturing industries, nine reported growth, seven declined, and two showed no change. The furniture industry reported declines in new orders, production output, and slower supplier delivery speeds. Although inventory levels grew, customer inventories remained high.
Furniture manufacturers also faced increased raw material costs, with the sector among 15 industries reporting higher expenses. Despite reporting no change in employment levels, the industry remains affected by broader economic challenges and increased competition.
The contraction in U.S. manufacturing, including the furniture sector, follows a brief period of growth in February and January, which marked a recovery from two years of continuous decline. However, the March downturn indicates that economic headwinds persist for manufacturers.
Source: www.designerstoday.com